Figure 1: Exit windows in a company's life cycle.

Exit window 1 is characterized by early acquisition of strategically important assets to a buyer. Exit window 2 is typically the revenue-based trade sale or public listing of a sustainable company. Venture-financed development from startup to the second exit window generally falls outside the scope of most venture capitalist mandates in the case of pharmaceuticals, except for orphan drugs. The dotted lines mean failure due to overspending and/or inability to become profitable.